Hodlnaut is the latest firm in a long line of crypto companies that have been stung by the recent market downturn.
Hodlnaut is a Singapore-based firm and was founded in 2019
Photo Credit: Hodlnaut
Crypto lender Hodlnaut has announced that it has filed for protection against creditors in Singapore in a bid to solve its liquidity issues. According to the announcement, Hodlnaut filed the application with the Singapore High Court on August 13, just days after the company halted withdrawals from its platform, to be placed under judicial management. The latest application filed by the company will temporarily protect it from any legal claims and proceedings against it by creditors. Hodlnaut also revealed that it is currently working with attorneys to avoid being forced to liquidate its assets at its present lower price.
"We are aiming to avoid a forced liquidation of our assets as it is a suboptimal solution that will require us to sell our users' cryptocurrencies such as BTC, ETH, and WBTC at these current depressed asset prices," the announcement read.
"This pause will provide us with the breathing space to focus our efforts on the recovery plan to rehabilitate the company," the statement added.
The Singapore High Court will appoint a judicial manager who will be an independent officer of the court to manage the firm as part of its judicial management process.
The firm has, however, applied to appoint a former partner at Deloitte Southeast Asia and the current director of Kairos Corporate Advisory, Chee Chong Tam, to take on the role of judicial manager. Chong Tam is also the company's option for the interim judicial manager while the Singapore courts review the firm's application.
Hodlnaut is expected to provide its next update on August 19 and hopes that its latest action will give it some time to devise a recovery plan to avoid liquidating customer assets.
The Singapore-based firm is the latest name on an already long list of crypto companies that have had financial issues this year due to the recent market downturn. Celsius, Voyager, and BlockFi are other firms stung by the recent market crash.
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